capital stack

capital stack

A description of the totality of capital invested in a project, including pure debt, hybrid debt,and equity.The stack is described as containing the most risk at the top,traveling down the stack to the position with the least risk. Higher positions in the stack expect higher returns for their capital because of the higher risk.Lenders and equity stakeholders are highly sensitive to their position in the stack.Typically, the stack is arranged as follows.

1. Sponsor equity
2. Preferred equity
3. Mezzanine investors (hybrid debt and equity)
4. Second and other junior mortgages
5. Investment-grade first mortgages

References in periodicals archive ?
The Firm has invested in virtually every category of real estate on a global basis, opportunistically shifting asset classes, geographies and positions in the capital stack as it perceives risk-reward dynamics to be evolving.
In this case, we were able to provide a one-source capital solution by participating in various tranches of the capital stack, which enabled the borrower to complete the acquisition, and to proceed with his plan to renovate and reposition the portfolio.
eProdigy is a FinTech holding company serving the alternative finance industry by providing products, services and a lending platform through its subsidiary companies: Capital Stack, ACHCapital, ACHBanking, eProdigy Loans, and 1Workforce.
Company spokesman Adam Stevens says the capital stack is mix of debt & equity and includes the participation of a prominent foreign investment group.
Additionally, HFF was able to structure a capital stack that is both accretive and flexible for the buyer.
Investment sales in the sector continue to benefit from a number of factors, including very strong market fundamentals and capital stack liquidity and "the new mantra of the millennial population looking to rent and not own," the JLL report stated.
The original capital stack was comprised of a $375 million first mortgage, $100 million in mezzanine debt held by three companies and $120 million in equity.
UC Funding provides financial solutions throughout the entire capital stack, including joint venture equity.
Josh Zegen, co-founder and managing principal of MRC, said his firm was able to provide "a one-source capital solution by participating in various tranches of the capital stack.
Capital Stack is also the co-founder and 50 percent owner of DailyFunder, an online forum and publication that covers the alternative finance industry.
Piramal Fund Management is uniquely capable of catering to the entire capital stack - right from early stage equity to late stage debt and now construction finance and is therefore able to act as a perpetual provider of capital within this space.
There is not a group more equipped to successfully operate this property than BSD, and RXR recognized that by aggressively providing equity to round out the capital stack.